Peruvian Sol (PEN)

What Is the Peruvian Sol (PEN)?

The Peruvian sol (PEN) is the national currency of Peru. It went into circulation in January 1991 under the name Nuevo Sol. Under a law that came full circle on Dec. 15, 2015, the name of the monetary unit was renamed Sol.

Grasping the PEN

As a Spanish state, Peru utilized the escudo, peso, and real as its currency. In spite of winning independence in 1821, it utilized the escudo until 1863, when its monetary system was decimalized and the sol was presented. Huge inflation forced Peru to update its currency in 1985 when it acquainted the inti with supplant the sol at a 1,000-to-1 ratio. Serious economic distress and episodes of hyperinflation required the government to scrap its currency again in 1991. The government presented the Nuevo Sol, which was equivalent to 1,000,000 inti.

On Dec. 15, 2015, the name of the national currency was changed from Nuevo Sol to just Sol.

Peru's political history illustrates the difficulties of keeping a stable currency. During the 1960s, equitably chose Fernando Bela\u00fande Terry embraced a system of economic liberalization, with an accentuation on [exports](/send out). His efforts were frustrated by the persevering threat of Cuba-propelled political uprisings. In 1968, General Juan Francisco Velasco Alvarado held onto power and nationalized the fishmeal industry, alongside several oil companies, banks, and mining firms.

In 1980, Peru returned to civilian rule keeping another constitution. Bela\u00fande Terry recaptured the administration on a platform of switching the previous ten years' financial blunder. Notwithstanding, his notoriety immediately disintegrated due to high inflation, economic hardship, terrorism.

Peru's economy fared better during a large part of the 21st century until the COVID-19 pandemic hit. The country had one of the most amazing histories years on poverty reduction, and growth in foreign direct investment had increased demand for the Peruvian sol.

Nonetheless, the recent pandemic has squashed the nearby economy. The country's gross domestic product (GDP) fell 11.1% in 2020. With that, the poverty rate hopped 27% — up 6 percentage points. Public debt hit 35% of GDP and the economy is expected to stay below pre-pandemic levels for 2021, at the end of the day settle.

Real-World Example of the PEN

The Central Reserve Bank of Peru issues the Peruvian sol in banknote divisions of 10, 20, 50, 100, and 200 soles. The currency is addressed with the symbol S/. The Peruvian sol is partitioned into 100 c\u00e9ntimos. Coins flow in groups of S/5, S/2, and S/1, and 10, 20, and 50 c\u00e9ntimos.

Peru's top trading partners are China, the United States, Canada, Korea, and Switzerland. Its biggest exports were copper, gold, oil, and zinc. As per World Bank data, Peru registered - 11.14% GDP growth in 2020, with inflation of 1.82%.

As of August 2021, one U.S. dollar bought roughly 4.07 PEN.

Highlights

• The Peruvian sol is Peru's national currency.
• Different currencies Peru has utilized over its time are the escudo, peso, real, inti, and Nuevo Sol.
• Peru's economic performance has worked on in the past couple of many years, with the country recently generating unobtrusive economic growth and gentle inflation.